Vietnam Agribusiness Report

Providing expert analysis, independent forecasts and competitive intelligence on the agribusiness industry.

Report includes: BMI Industry View, Industry SWOT Analysis, Industry Forecasts, Supply & Demand Forecasts, Commodity Price Analysis and Company Profiles.

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Vietnam Agribusiness Report
Product Price
$1,295.00

BMI View: Recent developments in the country's economic and business environment s add further weight to our positive view on Vietnam's agribusiness sector. The industry holds strong growth opportunities in terms of production, exports and retail sales, particularly with regard to the rice, coffee, livestock and dairy sectors. Moreover, economic and financial integration in South East Asia will benefit Vietnam's exports of rice, dairy and coffee. However, Vietnam is facing growing competition in its key markets . T he fulfilment of its promising potential will only be achieved if the country steps up its competitiveness and improves both product quality and supply chain efficiency. Vietnam will have to significantly ramp up investments on crop productivity in order to not be left behind and , if it does, it will be able to produce more value-added crops and maintain its status as an export spearhead.

Agribusiness Market Value
BMI Market Value By Commodity (2005-2020)
BMI Calculation/FAO

Key Forecasts

  • Sugar consumption growth to 2020: 23.0% to 2.4mn tonnes. Rising income, population and growing consumption of manufactured food products will help sugar consumption grow quickly in the coming years. Domestic production growth will not be able to keep up with consumption expansion.

  • Coffee production growth to 2019/20: 13.2% to 31.6mn 60kg bags. After more than a decade of strong output growth, coffee production expansion will slow down in the coming years. Low coffee prices and the attractiveness of alternative crops such as pepper will lead to a slowdown in new planted area growth.

  • Milk production growth to 2019/20: 61.9% to 876,000 tonnes. Dramatic increases in cattle numbers and increased public and private sector investment - part of the effort to reduce the country's growing import dependency - will be the main boost to growth. Commercialisation will also play a key role as larger, more efficient farms come to play a greater role in milk production.

  • 2016 BMI universe agribusiness market value: USD44.1bn (up from USD43.4bn in 2015; growth expected to average 3.3% annually between 2016 and 2019).

  • 2016 real GDP growth: 6.6 % (down from 6.7% expected in 2015; predicted to average 6.4% over 2015-2020).

  • 2016 consumer price index: 2.1% y-o-y (up from 0.8% expected in 2015; predicted to average 4.3% over 2015-2020).

K ey Developments

Along with other Asian and African countries, Vietnam's agricultural sector is being affected by the return of El Nino in 2015/16. Meteorologists believe that the phenomenon - which emerged in May 2015 - is currently in its decreasing phase and should dissipate in Q316. However, El Nino has had a strong impact on precipitation levels in South and South East Asia so far this season. In fact, after a period of dry weather recorded in August-October 2015, Vietnam and its neighbours have had to face another dry episode since January 2016, located around the Mekong river area. According to Vietnam's Ministry of Agriculture, in March 2016 the water level of the Mekong River - the country's rice and fruit basket - was down to its lowest level since 1926 during planting season for the key winter/spring rice crop.

Dry weather and the lack of water for irrigation, coupled with the ongoing government plan to switch acreage from rice to corn production will make rice production decline for the first time since 2010/11 in 2015/16.

Looking at coffee production in the 2016/17 season, for which the harvest will start in September 2016, we believe production growth will again be weak relative to the strong growth recorded until 2014. Apart from the dry weather, farmers have to battle with low robusta prices. Some farmers with old coffee trees (which make up to a third of total acreage) are not replanting their land with coffee trees, switching instead to other more profitable crops (especially pepper and fruits).

Improvement in Vietnam's economic activity in 2016 will help consumer spending increase after weak demand in 2014 weighed on demand for value-added agricultural products, including dairy.

The stronger economic outlook, coupled with some reforms regarding foreign investment and State Owned Enterprises are attracting a growing amount of domestic and foreign investors and reaffirm our bullish view on the agribusiness sector. Vietnam is seeing a wave of private investment in its upstream (farming) and downstream (dairy product manufacturing and distribution) dairy sector. The feed sector is also attracting investors, with Cargill announcing in Q415 it will build two new feed mills in Vietnam, adding to the 10 the company already owns in the country.

BMI Industry View
7
SWOT
10
Agribusiness
10
Industry Forecast
12
Grains Outlook
12
Table: Vietnam - Grains Production And Consumption Outlook
13
Table: Vietnam - Risks To Grains Outlook
13
Table: Corn Production & Consumption (Vietnam 2013-2020)
16
Rice Outlook
17
Table: Vietnam - Rice Production And Consumption Outlook
18
Table: Vietnam - Risks To Rice Outlook
18
Table: Rice Production & Consumption (Vietnam 2013-2020)
21
Dairy Outlook
22
Table: Vietnam - Dairy Production And Consumption Outlook
23
Table: Vietnam - Risks To Dairy Outlook
23
Table: Vietnam - Planned Investment In Milk Production Capacity
25
Table: Dairy Production & Consumption (Vietnam 2013-2020)
28
Livestock Outlook
29
Table: Vietnam - Livestock Production And Consumption Outlook
29
Table: Vietnam - Risks To Livestock Outlook
30
Table: Livestock Production & Consumption (Vietnam 2013-2020)
34
Coffee Outlook
35
Table: Vietnam - Coffee Production And Consumption Outlook
36
Table: Vietnam - Risks To Coffee Outlook
36
Table: Coffee Production & Consumption (Vietnam 2013-2020)
41
Commodities Price Analysis
42
Global - Global Commodities Strategy
42
Table: Select Commodities - Performance And BMI Forecasts
42
Upstream Analysis
44
Asia GM Outlook
44
Table: Selected Countries - GM Crops Use (mn hectares)
47
Asia Machinery Outlook
49
Table: Select Countries - Average Size Of Farms, Hectares
52
Asia Fertiliser Outlook
55
Downstream Analysis
60
Food
60
Canned Food
61
Confectionery
62
Pasta
62
Dairy
63
Regional Overview
64
Table: Impact Of El Ni-o On Crops
64
Competitive Landscape
69
Table: Major Agribusiness Companies (USDmn)
69
Demographic Forecast
70
Table: Population Headline Indicators (Vietnam 1990-2025)
71
Table: Key Population Ratios (Vietnam 1990-2025)
71
Table: Urban/Rural Population & Life Expectancy (Vietnam 1990-2025)
72
Table: Population By Age Group (Vietnam 1990-2025)
72
Table: Population By Age Group % (Vietnam 1990-2025)
73
Methodology
75
Industry Forecast Methodology
75
Sector-Specific Methodology
76

The Vietnam Agribusiness Report features BMI Research's market assessment and independent forecasts for production, consumption and trade across core agricultural commodities.

BMI's Vietnam Agribusiness Report includes independent commodity price forecasting and analysis for key agricultural outputs, an overview of the agribusiness competitive landscape and a discussion of the downstream context of agricultural production in relation to country food consumption forecasts and composite food and beverage trade forecasts.

Key Benefits

  • Use BMI's independent industry forecasts to test other views - a key input for successful planning in dynamic agribusiness markets.
  • Apply BMI's medium-term commodity price analysis to assist with budgetary planning and the identification of investment opportunities and potential risks.
  • Assess the activities and market position of your competitors, partners and clients.

Coverage

BMI Industry View

Summary of BMI’s key industry forecasts and views, highlighting recent changes and key risks to the industry outlook.

Industry SWOT Analysis

Analysis of the major strengths, weaknesses, opportunities and threats within the wider agricultural industry.

BMI Supply & Demand Forecasts

Divided into sections based on various diverse sectors in the agriculture market, the chapter provides insight into each market’s agricultural industry, centred on sector forecasts to end-2019 for the consumption, production and trade of key commodities.

  • Consumption Forecasts: Accompanied by a discussion of the main drivers of consumption growth: macroeconomic factors, food processing trends, price movements and increasingly, demand from the non-food sector.
  • Production Forecasts: Examine the trends influencing BMI’s production outlook: global demand, price increases, public and private sector investment and agricultural efficiency improvements.
  • Trade Forecasts: Accompanied by a discussion of the factors influencing a country’s trade in agricultural goods, including domestic demand, global prices and government trade policies.
  • BMI’s Forecasts: Accompanied by a risks-to-outlook assessment, which examines potential factors that could affect our existing forecast picture and the likelihood of their occurrence.

BMI’s Commodity Price Analysis

Fundamental and technical analysis of the short- and medium-term price outlook for eight agricultural commodities based on globally recognised benchmarks.

Downstream Analysis

Analysis of headline food and drink forecasts, including total food consumption, per capita food consumption and total sector trade, which provide important downstream intelligence for primary agricultural producers.

Featured Analysis

Includes relevant articles from BMI’s daily analysis service. These can include: long-term projections on agricultural imports and exports; our perceptions of the impacts of economic slowdown on key companies and subsectors within the Agribusiness industry in a given country; our analysis of fertilizer production; as well as other relevant analysis of recent news and events.

Competitive Landscape

The reports contain information on prominent companies operating in each market.

Key Commodities Covered By The Agribusiness Market

Reports Include: Grains, Dairy, Livestock, Rice, Sugar, Palm Oil, Edible Oils, Coffee, Cocoa, Cotton, Soybean

Please note – not all reports cover all commodities.

Sources

The Agribusiness reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.